Employment Relations Act 1999 (Blacklists) Regulations 2010

My Lords, as my honourable friend Jonathan Djanogly made clear in the debate on these regulations in the other place on 8 February, the Conservative Party is absolutely opposed to discrimination against individuals, and discrimination on the grounds of trade union membership is no exception. In fact, it was under a Conservative Government that the Trade Union and Labour Relations (Consolidation) Act was enacted in 1992, Section 137 of which made it unlawful for employers to discriminate against individuals due to their membership of a trade union. These regulations recognise that it is perfectly legitimate for employers to keep a list of union employees for a number of administrative reasons. However, they will increase the burden on employers because it will make it more difficult for those who hold such lists to know when their actions break the law. The same list could theoretically be kept by two employers and one could be in breach of the new regulations while the other is not. This uncertainty is likely to place further strain on the normal administrative practices of employers in dealing with workers, which necessarily involve compiling and keeping lists. There is also the risk that employers may be subject to unnecessary, perhaps vexatious, actions against them by employees for being in possession of such lists, which are, in fact, being used exclusively for legitimate purposes. For example, my honourable friend pointed out the legitimate need for an employer to know which employees are union members, so that negotiations can be had with the union on their behalf, and which are not union Members and so need to be negotiated with directly. The end results of regulations such as these can only be to increase the number of wasteful employment tribunal claims. It is already unlawful for employers to discriminate against individuals on the grounds of their trade union membership or activities. The final impact assessment on the regulations describes them as having, ""a wholly positive effect in safeguarding personal information"," but are they really necessary? Surely better enforcement of existing legislation would have an equally positive effect. Turning to the case of the Consulting Association, which inspired these new measures, it should be highlighted that the illegal actions were discovered not, of course, as a result of these regulations, because they were not in force, but as a result of the Information Commissioner’s existing investigative powers under the Data Protection Act. The creation of lists in relation to trade union membership is treated as sensitive personal data and is therefore covered by the Data Protection Act, which provides comprehensive protections for data subjects and imposes duties on data processors. It did not require these regulations. It is therefore difficult to see that the way to work towards solving this issue is through yet more regulation. Why would it not be more appropriate, if, indeed, it is necessary, to make improvements to the Data Protection Act to enable it to be put to more effective use in this area? There is little or no evidence about the scale, if any, of blacklisting taking place. Indeed, the final impact assessment of the regulations describes blacklisting as, ""an unusual, and uncommon, activity"." The Minister acknowledged that in his introductory remarks. The real problem is the covert nature of the blacklisting that takes place, which, unless I am mistaken, the regulations do not address. Legislation is already in force to tackle discrimination once it is discovered. The facts of the Consulting Association case suggest that the wrongdoers were not ignorant of the law but were keen to conceal their activities. The final impact assessment states that the objective of these regulations is to, ""give a clear signal about the unacceptability of blacklisting"." Clearly, targeted measures would be far more useful than signals. The regulations do not create any new investigative powers, and further cases are likely to be discovered only by enforcement of the Data Protection Act. The burden on businesses is real, but currently unquantifiable, so it is completely unclear how accurately the costs to business have been measured by the Government. In July 2009, the initial impact assessment predicted costs of £526,000, but in the January 2010 impact assessment that figure was reduced by more than 50 per cent to £285,000. The costs and burdens to businesses are twofold. First, there are the costs of them familiarising themselves with these new regulations and implementing changes. Secondly, there are costs associated with failures in compliance or in dealing with legal actions by employees where there have been alleged failures. The January 2010 impact assessment recognises but does not provide a figure for the potential additional costs where there has not or may not have been full compliance by businesses. It is estimated that 3,200 public and private sector employers will be impacted by these regulations. It is an unfortunate time to lay this additional regulatory burden on businesses, particularly when it is demonstrably unnecessary. The fact that the Government initially postponed indefinitely implementation of these regulations suggests that they do not add anything to existing legislation. The CBI has described the measures as, ""knee-jerk reactions to one-off events"." A further disturbing issue is the perfunctory response to feedback from the consultation process. The Government failed to address trade union concerns about the scope of these new regulations. The Union of Construction, Allied Trades and Technicians feels that there is inadequate protection under the new regulations. In conclusion, we need a full explanation from the Minister if we are not to conclude that this is an example of yet more unnecessary, burdensome red tape at a time when the focus of all businesses should be on getting on with business without distraction from more expensive and unjustified regulation.